Stocks seesaw on mixed earnings

NEW YORK (CNNMoney.com) -- Stocks ended mixed after a choppy session Wednesday, as differing profit reports from Apple and Yahoo weighed on the tech sector and investors remained wary following strong quarterly reports from Morgan Stanley and Wells Fargo.

The Dow Jones industrial average (INDU) added 8 points, or less than 0.1%, to end at 11,124.92. The S&P 500 index (SPX) fell 1 point, or 0.1%, to settle at 1,205.93, and the Nasdaq composite (COMP) rose 4 points, or 0.2%, to close at 2,504.61.

"As we get beyond earnings, attention is going to turn right back to the housing and job markets," said Dave Hinnenkamp, chief executive of KDV Wealth Management. "The downturn has left a really big scar, and investors who got burned will be cautious for some time."

"Investors were holding their breath for this earnings season, and it looks like it's going to be decent," Hinnenkamp said. "This makes people comfortable saying we're in a recovery process, but it's going to be a slow one."

"The tech sector leads out of the recession," Hinnenkamp said. "After that we'll be looking for the industrial and material sectors to rise -- and once we move forward, attention will turn to the energy sector."

Wells Fargo (WFC, Fortune 500) reported a $2.5 billion profit before the bell, beating Wall Street expectations. The company said that credit conditions have "turned the corner" from the weakness of the financial crisis. Still, Wells shares fell almost 2% by the end of trading.

Also, Chrysler announced that it earned its first operating profit since exiting bankruptcy on June 10, 2009. The profit follows nearly $4 billion of losses logged by the automaker during that time.

The results continued after the markets closed, with Starbucks (SBUX, Fortune 500) and other major names reporting results after the bell. The coffee chain handily beat profit and sales estimates, and the company lifted 2010 guidance. Shares were up 2% in after-hours trade.

In other company news, General Motors announced Wednesday morning that it had made a final payment of $5.8 billion late Tuesday to the U.S. and Canadian governments, paying off the last of its $6.7 billion in loans.

Outlook: "Psychological issues will continue to drive the markets," said KDV's Hinnenkamp.

He expects a slow but continued higher trend, with the S&P around 1,200 in the coming weeks, and the Dow around 11,250.

"The economy is improving, but slowly," Hinnenkamp said. "Thus recovery wont come as quickly hoped for, and a sustained bounceback can come only once housing and jobs kick in."

But even negative news outside of the real estate and employment sectors could put a damper on the uptick, Hinnenkamp added.

"Any piece of bad news, people worry there's an Armageddon," he said. "But there's always good and bad news out there -- it depends where you choose to focus."

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